As PC sales stall, Apple projected to sell 69M iPads in 2012
Apple's iPad is expected to continue dominating the tablet market with a share higher than 60 percent, while PC sales are projected to continue their downward trend, according to a new analysis.
Analyst Rob Cihra with Evercore Partners revealed in a note to investors on Monday that he has cut his projected PC sales for the remainder of the year. He sees traditional computer sales dropping 4 percent year over year in the third quarter of calendar 2012, while overall PC growth for the year will be flat with 2011.
Cihra believes sales of tablets like Apple's iPad are responsible for "at least half" of the PC market's current decline. He noted that consumer PCs have struggled ever quarter since they topped out in the third quarter of 2010, which is just one quarter after Apple launched the first-generation iPad.
His projection comes only days after the latest estimates show PC shipments dropped 0.1 percent worldwide and 5.7 percent in the U.S. in the June quarter. One of the few bright spots in the market was Apple, which saw its domestic Mac sales grow 4.3 percent.
While Cihra believes PCs will continue to struggle going forward, even with the launch of Microsoft's new Windows 8 operating system, he has big expectations for the iPad. His forecast calls for Apple to sell 69 million iPads in calendar year 2012, taking more than 60 percent of the market, even in the face of competition from Microsoft's Surface tablets and Google's Nexus 7.
For the just-concluded June quarter, Cihra sees Apple having sold 16.5 million iPads, which would represent 78 percent year-over-year growth. That's slightly higher than the 16 million iPads Gene Munster with Piper Jaffray believes Apple sold, while lower than the 20-million-unit projection from Charlie Wolf of Needham & Company.
Cihra believes that a quarter of tablet purchases are truly direct replacements for PCs, while another quarter are "effectively" replacing PCs, as users delay purchasing a new computer by getting an iPad or another tablet.
"PCs now need to compete both directly/functionally and more so indirectly (for discretionary spend/mindshare) against 'thin client' architectures/ecosystems," Cihra wrote in his note to investors on Monday.
Analyst Rob Cihra with Evercore Partners revealed in a note to investors on Monday that he has cut his projected PC sales for the remainder of the year. He sees traditional computer sales dropping 4 percent year over year in the third quarter of calendar 2012, while overall PC growth for the year will be flat with 2011.
Cihra believes sales of tablets like Apple's iPad are responsible for "at least half" of the PC market's current decline. He noted that consumer PCs have struggled ever quarter since they topped out in the third quarter of 2010, which is just one quarter after Apple launched the first-generation iPad.
His projection comes only days after the latest estimates show PC shipments dropped 0.1 percent worldwide and 5.7 percent in the U.S. in the June quarter. One of the few bright spots in the market was Apple, which saw its domestic Mac sales grow 4.3 percent.
While Cihra believes PCs will continue to struggle going forward, even with the launch of Microsoft's new Windows 8 operating system, he has big expectations for the iPad. His forecast calls for Apple to sell 69 million iPads in calendar year 2012, taking more than 60 percent of the market, even in the face of competition from Microsoft's Surface tablets and Google's Nexus 7.
For the just-concluded June quarter, Cihra sees Apple having sold 16.5 million iPads, which would represent 78 percent year-over-year growth. That's slightly higher than the 16 million iPads Gene Munster with Piper Jaffray believes Apple sold, while lower than the 20-million-unit projection from Charlie Wolf of Needham & Company.
Cihra believes that a quarter of tablet purchases are truly direct replacements for PCs, while another quarter are "effectively" replacing PCs, as users delay purchasing a new computer by getting an iPad or another tablet.
"PCs now need to compete both directly/functionally and more so indirectly (for discretionary spend/mindshare) against 'thin client' architectures/ecosystems," Cihra wrote in his note to investors on Monday.
Comments
Eventually, it was clear that the iPad was starting to eat into traditional laptop sales. Apple was actually the first to publicly acknowledge this, while everyone else was still trying to do damage control. After a few bad quarters, PC makers started admitting, on the record, that the iPad was effecting their mobile business.
That was followed by a rush to KIRF the MBA, only to discover that people didn't want an ultra book; they wanted a Macbook Air. Now, it is becoming clear that the iPad is starting to cannibalize traditional PC sales, full stop! Isn't history fun?
It's funny how the so-called tech nerds refuse to accept reality. They move from one topic to another hoping to find the magic bullet that will finally kill Apple. The latest argument is how a tablet running full Windows will decimate the iPad in business. The netbooks were to be the magic bullet, then the ultrabooks, then the Fire and now the Nexus 7. Just jump from one Apple killer to the next hoping against hope. It really is all about Apple with these people isn't it.
If AAPL's financial results are once again spectacular, as expected, we'll start hearing the "wait till such-and-such comes out" arguments almost immediately.
Because they like to play with their PCs. Pulling cards out of boxes, re-wiring, buying new cards to fit into slots. "Upgrading" so they can boast about an extra 5fps in the latest shooter. Comparing the latest Nvidia card to the latest ATI card, with accompanying squeals of excitement over the new anti-aliasing options.
Apple threatens tech nerds' play-time and spec chest-thumping.
Quote:
Originally Posted by lkrupp
It's funny how the so-called tech nerds refuse to accept reality. They move from one topic to another hoping to find the magic bullet that will finally kill Apple. The latest argument is how a tablet running full Windows will decimate the iPad in business. The netbooks were to be the magic bullet, then the ultrabooks, then the Fire and now the Nexus 7. Just jump from one Apple killer to the next hoping against hope. It really is all about Apple with these people isn't it.
If AAPL's financial results are once again spectacular, as expected, we'll start hearing the "wait till such-and-such comes out" arguments almost immediately.
Ice Cream Sandwich/Jellybean has surpassed IOS.
WP8 Apollo is also going to do very well.
Both are just as fluid, yet more advanced, modern and intuitive than IOS is in it's current state.
Quote:
Originally Posted by digitalclips
Im not sure 'PC Growth Trendline' is the correct wording there!
Have to agree in principle…!
It's interesting to me that either way (with or without tablet "cannibalization") the trend line is downward. Tablets are just making the negative trend steeper?
Apple is also bucking that downward trend with their own "PC" sales, no? ("PC" meaning Mac laptops & desktops.)
Last I recall reading their "PC" sales were up 4% year on year while the rest of the (WIndows?) PC market was down...
Quote:
"PCs now need to compete both directly/functionally and more so indirectly (for discretionary spend/mindshare) against 'thin client' architectures/ecosystems," Cihra wrote in his note to investors on Monday.
I wouldn't call the iPad a 'thin client' in the traditional sense. It is thin, and it has less storage than a modern desktop or laptop, but its reliance on a server's computational power and storage is hardly any greater than that of a common pc for most people.
In malware or lag?
Based on current lousy sales of Windows Phone and Nokia tanking? Windows Phone has been on the market for nearly two years, and in all that time,
after hundreds of millions of dollars poured into marketing, ad campaigns, product demonstrations and a lot of chest-thumping,
the entire platform is on the verge of collapse, never mind having *lost* market share from the 1-2% they had in the past.
The reality is that Windows Phone is not only terribly late, bringing nothing new to the table, it's also incredibly redundant. iPhone users won't leave,
and Android is just to attractive an option for the rest of the market. Where does that leave a late platform that is *just adequate*, that currently
offers users a lot less? Nowhere, really. As we're seeing.
This isn't what consumer satisfaction reports are saying. iPhone is tops year after year, sometimes by a wide margin.
But THIS year it'll be different. They promise! Right? WP8 Apollo will CHANGE EVERYTHING! And JellyBean will cut
into sales of iOS and iPhones!
The only market share that Android devices cut into are OTHER Android devices (much to HTC's chagrin.) iOS users stay loyal.
They'd cut into Windows Phone sales, too, if there were anything to cut into.
Quote:
Originally Posted by Boogerman2000
Ice Cream Sandwich/Jellybean has surpassed IOS.
WP8 Apollo is also going to do very well.
Both are just as fluid, yet more advanced, modern and intuitive than IOS is in it's current state.
Even if that were true, those other solutions don't have the ecosystem or the integration with the App Store, iTunes and the developer programs which are the most compelling part of iOS. Regular people, not geeks, find the iPad and iPhone so enjoyable to use that they have a huge margin over the other platforms in customer retention and satisfaction. More "Fluid", if that were even true, is just not enough to win the hearts and minds of the general public or smartphone users.
The most compelling feature of the other platforms is that often they sell for less, BOGO, and that they are an option for the Apple hater crowd. As we have read countless times, when you look at the numbers, iPhone users actually use their smartphones where as the majority of the Android users are just txt and calls, no Internet and no apps. No one disagrees that that there are lots of Android phones out there but the vast majority are of the low end variety used by low tech users.
I haven't been here in a while, I see the only thing that's changed is the awful new format.
Quote:
Originally Posted by Boogerman2000
Ice Cream Sandwich/Jellybean has surpassed IOS.
WP8 Apollo is also going to do very well.
Both are just as fluid, yet more advanced, modern and intuitive than IOS is in it's current state.
I think you just proved his point.
However, I don't think there is any evidence supporting your first claim. Certainly not in numbers, since most new Android phones ship with 2.3, and most users will never get an upgrade to anything. Technologically, I think you've confused feature count with quality.
As for how well WP8 will do, it's speculation, but, if we were to base it on history, we'd have to conclude it won't matter.
Your last statement is just empty rhetoric.
Quote:
Originally Posted by Boogerman2000
Ice Cream Sandwich/Jellybean has surpassed IOS.
WP8 Apollo is also going to do very well.
Both are just as fluid, yet more advanced, modern and intuitive than IOS is in it's current state.
Just curious… in what way have the latest versions of Android "surpassed" iOS? I'm not sure what you mean by that...
WP8 … "apollo"? Without context, it seems a reasonably good OS (in theory, it remains to be seen), and could be positioned to do well. Given the context of market realities however, and that it's still many months away, this is a pretty speculative statement… it may do well, relative to how WP is doing today (still losing market share)… Could you quantify your idea of "do very well" for me? Again, just curious…
In your last sentence, when you say "fluid"… are you talking about scrolling, et al? And in what ways exactly are they more "advanced, modern and intuitive"…? Are you including iOS6 in your comparison, or just referring to iOS5?
Anyway, it seems your opinion squarely favors both Android and an as-yet non-existent version of Windows Phone as clearly superior to iOS…
However, since that was just a series of brief, blanket statements without any specifics, I'm not sure where I can agree OR disagree with you...
Shh… let the anti-Apple brigade dream. It's all they have left.
Quote:
Originally Posted by Boogerman2000
Ice Cream Sandwich/Jellybean has surpassed IOS.
WP8 Apollo is also going to do very well.
Both are just as fluid, yet more advanced, modern and intuitive than IOS is in it's current state.
Looks like we have one guy spinning the story to dizziness.
ICS & Jellybean. Two OS's that no one has... "but hey, <insert yet another iOS-killer Android OS here> will put Apple in it's place"
Sure, iOS takes all the money, but Android OS, even though it's free, will surely make up for it on volume.... *rolls eyes*
Both are fluid for sure. They have to be when they're swirling in the big toilet bowl of tech-jokes...
Quote:
Originally Posted by paxman
I wouldn't call the iPad a 'thin client' in the traditional sense. It is thin, and it has less storage than a modern desktop or laptop, but its reliance on a server's computational power and storage is hardly any greater than that of a common pc for most people.
Just to give the author the benefit of the doubt...he/she might not have been restricting the observation to the iPad. As the trend in business (vs the "most people" you mention...remember, PC sales are heavily weighted to corporate buyers) is to move more and more data and processing to the cloud (ie, the company's servers), users no longer need a powerful machine at their desk. This means a couple of things:
a) That old PC on a user's desk doesn't need to be replaced as frequently.
b) An old (repurposed) desktop machine could replace an underpowered laptop if the mobile needs can be met via a tablet.
And there are probably a few other factors, all contributing to a decline in PC sales. The iPad is just a contributing factor, and only one example of a "thin client".
The writing is on the wall, PC as we have known them for the pass 30 years has been played out. Yes I may go and buy a new Desktop since my current one is 8 yrs old and Apple finally killed it with icloud and Mountain Lion, I do most of the daily email and surfing on an ipad. I still use a Desk top for more work intensive things, but like the last one I do not expect to replace it ever 3 yrs like has happen in the PC space.
The two frontiers in computing is mobile computing and cloud (client/Server) computing if a company is not in these two spaced they are going to be buggy whip in the coming years. Even Dell is recognizing this, they went out and bought a company they provide software solution to the server and cloud computing companies.
Quote:
Originally Posted by Boogerman2000
Ice Cream Sandwich/Jellybean has surpassed IOS.
WP8 Apollo is also going to do very well.
Both are just as fluid, yet more advanced, modern and intuitive than IOS is in it's current state.
Looking up your posts, I see that you're flogging the same message that you did eight months ago. Isn't it getting a little old?
Other than that, I've always gotten a chuckle from your handle, señor. Once again it underscores the adage that "you are what you eat."
Also Walt Mossberg review from All ThingsD: "From Google, the Toughest Challenger to the iPad". If they like Nexus 7, then I'm gone buy this tablet! Just saying, for all of you who think Nexus 7 is garbage, read the reviews. Finally, we have true competition!
Last time the purported "toughest challenger" was the Kindle Fire.
Now, it's supposed to be the Nexus 7. Same idea. Same, bubbly reviews. And then a few months later the reality of the iPad hits.
I remember when the Laptop first came out and people said it was the death of the desktop. Never happened - some people bought laptops and some people continued to buy desktops. I suspect the tablet computer will have the same effect - it's just another computer format. It's not going to kill anything. The laptop and desktop will continue for many years.
As for that graph it just poses more questions than answers. If the iPad is directly responsible for the drop in PC sales then why did Y/Y PC growth fall in 1999-2001, 2005-2006 and 2007-2009 ? There was no iPad to explain those declines. I'm sure the iPad is taking sales away from the PC but it's impact is being overstated to prove a point and talk up the share price again. I don't know anyone who uses an iPad as their only computer - they all have a laptop or desktop as well. I love my iPad but I wouldn't scrap my desktop for it.